Valerie Barckhoff's Webinar regarding the implementation of ICD-10.

1. TIME IS RUNNING OUT – ARE YOU READY FOR ICD-10?
Valerie F. Barckhoff
December 2014

2. What’s going on with ICD-10?
• With the Texas Medical Association leading the
charge, physicians across the country were pleading
with Congress to delay ICD 10 until 2017
– The goal was to add the delay to the $1.1 trillion
spending bill on December 11, 2014
• But no language was included in the bill that would
delay the implementation of ICD 10
• So, will October 1, 2015 be the compliance date?
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3. What’s going on with ICD-10?
• Your guess is as good as mine
– Physicians will continue to challenge the 2015 date
– Hospitals and Payers will continue to support the 2015
date
– And we all have to make decisions on how to proceed!
• Here’s what we can tell you:
– You can’t afford to not prepare!
• But, we’re going to share with you what we’re
advising our clients to do….
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4. But First, Let’s Talk About the State of Readiness
• In September, 2014, WEDI released the results of it’s
ICD-10 Industry Readiness Survey
– So, who did they survey?
• 324 Providers
• 87 Vendors
• 103 Health Plans
Source: Workgroup for Electronic Data Interchange (WEDI) ICD-10 Survey Results; September 2014
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5. ICD-10 Readiness: Vendors
• Who were the Vendors in the survey?
– Clearinghouse services
– Electronic health records
– Coding Service
– Revenue Cycle Services
– Products
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6. ICD-10 Readiness: Vendors
• Two-fifth’s of vendors have completed their ICD-10
product development
– Another third are at least three-quarters complete
• Two-third’s of vendors indicate that their ICD-10
products are already available to customers
Overall Assessment: Made progress during one year
delay with slippage only related to testing
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7. ICD-10 Readiness – Health Plans
• Who were the Health Plans in the Survey?
– Blue Plans
– Commercial Plans
– Federal Plans
– State Agencies
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8. ICD-10 Readiness – Health Plans
• Nearly three-quarters of health plans have completed
their ICD-10 impact assessments
• Three-quarters of health plans have started internal
testing
• Over half of health plans have begun external testing
Overall Assessment: Made progress during one year
delay
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9. ICD-10 Readiness - Providers
• Who were the Providers in the Survey?
– Health Systems/Hospitals (1/2 of providers surveyed)
– Physician practices (1/3 of providers surveyed)
– Respondents were equally distributed across the
country
• Slightly more urban respondents than rural
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10. ICD-10 Readiness - Providers
• Only half of providers have completed their ICD-10
impact assessment (no improvement from previous
year)
• One-third of providers have begun external testing.
• Over half of providers indicated that they did not
expect to begin external testing until 2015
Overall Assessment: The delay has negatively
impacted readiness for providers (providers either
slowed-down or halted efforts)
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11. Why Should You Care if Providers Aren’t Ready?
• We all know Coder Productivity will go down
– Estimates are between 20% and 60% decrease in
productivity
– This will negatively impact an organizations DNFB!
• The financial risk is HUGE
– CMS estimates that Accounts Receivables will increase
between 20% and 40%
– And that can have a dramatic impact on your Days
Cash on Hand
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Increase
20% 40%
Days AR 45 54 63
AR $ 40,137,000 $ 48,164,400 $ 56,191,800
Days Cash on Hand 125.9 116 106
Days Cash Reduction -9% -16%

12. It gets worse….
• CMS also expects rejections/denials to increase
between 100% and 200%!
– A hospital with an average 10% rejection/denial rate
can see a dramatic impact when ICD-10 goes live
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Increase
100% 200%
Net Patient Revenue $ 293,000,000
Rejection/Denials $ 29,300,000 $ 58,600,000 $ 87,900,000

13. What Now?
• Do you spend hundreds of thousands, even millions,
on ICD-10 readiness?
• Do you wait and hope for a delay?
• What is the best strategy with all this ambiguity?
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14. WB Recommendations
• We believe that the majority of ICD-10 readiness
activities should be handled by an internal project
team.
• We also believe that, because of the heavy financial
and compliance issues related to ICD-10, that you
should have an independent, 3rd party evaluate your
readiness activities
Let’s discuss these two items separately
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15. Handle ICD-10 Internally as a Project
• First, let’s talk timeline and where you should be
NOW!
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Revised CMS Hospital Implementation Timeline (www.cms.gov/icd10)
Spring 2013 Summer 2013 Fall 2013 Winter 2014 Spring 2014 Summer 2014 Fall 2014 Winter 2015 Spring 2015 Summer 2015 Fall 2015
Impact
Assessment
Implementation
Plan
Vendor
Assessment
Initial Budget
Training and Education
Internal System Design and
Testing
Internal
Testing
Implementation of ICD-10 remediation project plan
External Testing
Intensive Training for Coders
Transition ICD-10
systems to
production
Full Compliance
Today
Full Compliance

16. Handle ICD-10 Internally as a Project
• We know from the WEDI survey that 50% of the
providers have not completed an impact assessment.
• So, let’s focus on a rapid, catch-up plan
– Step 1: Establish an ICD-10 Project Management
Structure and Governance
• Don’t underestimate the importance of having an
effective governance structure in place
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17. Handle ICD-10 Internally as a Project
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Steering
Committee
ICD-10
Program
Office
SC should include Executive and
Functional Leadership (C-level and VPs)
ICD-10 PMO should include Business
Owners, a Project Manager, Compliance
and other support
IS&T
HIM/
Coding
PFS
Managed
Care
Education
/ Training
Finance
Important Note: It may be necessary to hire an experienced
Project Manager for this project, depending upon the size of the
organization

18. Handle ICD-10 Internally as a Project
• Step 2: Complete an impact assessment that includes:
– Key business processes
– Systems and interfaces
– Vendors, clearinghouses, and other business
associates
– Identification of key metrics to monitor throughout the
implementation process
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19. Handle ICD-10 Internally as a Project
• ICD-10 Impact Assessment Checklist
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Item Assigned
To:
Completion
Date:
Create a list of all electronic systems that use ICD-9
Document all work flow processes that use ICD-9
Create a list of vendor contact information
Identify all departments/staff that work with ICD-9
Identify necessary work flow changes to comply
with ICD-10
Identify contact for all payers
Survey vendors to determine their ICD-10 plans
Survey Payers to determine their ICD-10 plans

20. Handle ICD-10 Internally as a Project
• Step 3: Develop an ICD-10 transition plan and budget
– Policy, procedure and system updates
– Training
• Beyond Coding!
– Vendor tasks and monitoring
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21. Handle ICD-10 Internally as a Project
• Step 4: Communication and Knowledge Sharing
– If you do not actively communicate with your
stakeholders, they will fill in the blanks with the
WRONG information
– Have a plan for:
• Internal Staff
• Contractors
• Vendors
• Other Key Stakeholders
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22. Handle ICD-10 Internally as a Project
• Step 5: Risk Management
– How will you track and manage issues?
– At a minimum, you need to keep an ICD-10 issues log
• Reviewed weekly at Program Office
• Actively communicated to Steering Committee
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23. Handle ICD-10 Internally as a Project
• Step 6: Implementation Management
– Who owns each of the vendor contacts?
• Want to make sure your vendors are ready for ICD-
10
– Active management and progress of internal and
external implementation activities
– Tracking and report on implementation progress
• Do not be afraid to have a “red light” task
– Active issues monitoring and development of risk
mitigation strategies
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24. Handle ICD-10 Internally as a Project
• Step 7: Training
– Should be role specific
– Begin with a pre- and post-assessment
– Have Knowledge champions
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25. Handle ICD-10 Internally as a Project
• Step 8: Clinical Documentation Improvement (CDI)
– Conduct an evaluation of your documentations
readiness for ICD-10
– Identify improvement areas
– Develop CDI quality monitoring and improvement
programs
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26. Handle ICD-10 Internally as a Project
• Step 9: Testing/Readiness for go-live
– Develop a clear test strategy and detailed test plan
• Should go beyond technical testing, but include the
outcomes
– Develop business scenarios
• Focus on processes with the highest ICD-9 volume
and the greatest financial impact to the
organization
– Conduct end-to-end testing
• Full execution of a process with a business partner
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27. Engage a firm for ICD-10 IVV
• What is IVV?
– Independent Validation and Verification
• Why is it important?
– Provides an independent, 3rd party view of readiness
activities
– It’s an important part of Risk Mitigation strategies
– Provides the Board assurances that the internal
Leadership team and the Business Owners are focused
on the right activities
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28. Engage a firm for ICD-10 IVV
• Executives should be concerned about their
organization’s readiness for ICD-10
– Will they be able to comply with the October 1, 2015 deadline?
– Is the organization focused on the right activities to achieve
compliance?
– Will vendors be able to comply with the October 1, 2015 deadline?
– Will coders and physicians be ready for the documentation changes?
– Will the business process break during the transition?
– Will our patients be negatively impacted?
– Will this be a revenue neutral event for the organization?
– Are they prepared for the worst case scenarios?
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29. Our Team
• Valerie F. Barckhoff is a Principal in Windham
Brannon’s Healthcare Advisory practice
– Valerie has over 20 years experience in the
revenue cycle and compliance, both in
consulting and operations. She has provided
numerous clients support in ICD-10
readiness, and has served on Regional
panels for HFMA on ICD-10
– Bachelors, Health Sciences – University of
Kentucky
– MBA, Finance/Management – University of
Tennessee
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30. Windham Brannon
Windham Brannon is proud to provide tax, audit, accounting and
advisory services to the healthcare community. As a recognized
leader in Atlanta and the Southeast since 1957, we are known for
our technical expertise and commitment to the highest level of
service. Our healthcare clients find a more proactive approach,
more attention to their priorities, and more investment in their
relationship with us to ensure their needs are anticipated – and
met with confidence.
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Contact information:
3630 Peachtree Road NE, Suite 600
Atlanta, Georgia 30326
404.898.2000 | windhambrannon.com